When Pina Ferlisi arrived for her first day at Gap HQ in New York two years ago she made an announcement that was, frankly, pretty incredible. Incredible in the sense that it was a somewhat daring thing to say in America, but also in that it sounded not just heretical, but downright impossible. "You know," this pretty, bright-eyed brunette said to her new team, "when you travel abroad and you see someone and you look at how they're dressed and you say, that must be an American?" Her team all laughed and groaned, their heads probably filled with images of overweight American tourists in tapered jeans, badly cut T-shirts and strange rubber sandals. "Well," Ferlisi announced stoutly, "we're going to change that."

Pretty bold, don't you think? Not least because at that time many would have cited Gap itself as the great purveyor of this American tourist style - all boxy cuts, stiff khakis and no jean complete without a bit of tapering. But today, when you think of Gap you think of pretty striped jumpers, cool trenchcoats, those tweed jackets that everyone seemed to have this winter and those double pocket bags that everyone really does have.

It is now a credible fashion store on the high street. Sure, there's still the occasional average piece, but in the past two years Gap has picked itself up from its frumpy rut and actually become - yes, really - stylish. Not fashionable in the Topshop sense, with their near-as-dammit takes on designer pieces, but pretty, with little winking nods at trends. So perhaps the most incredible thing about Ferlisi's statement is that she actually might be making it happen.

Ferlisi, 39, has the friendly, open looks of a high-school cheerleader and a lilting voice to match. Her office in downtown Manhattan is so big she can fit a boardroom table in it and still have plenty of space for her piles of magazines, posters, signed photos from current Gap poster girl Sarah Jessica Parker ("lots of love") and a desk with impressive multi-views of the city. She looks like the American dream come true, which is apt as the style she sells at Gap is very much one of sepia-hued Americana - cute little T-shirts, rolled shorts, cheerful summer dresses and moccasins. All perfect for lazy days in Connecticut which, coincidentally, is where Ferlisi lives with her husband, who owns two local restaurants ("So we always have somewhere to eat"), and their two small daughters. "I just need that balance," she says, shrugging off the daily two-hour commute.

She has perfected this Happy Days style throughout her career. One of her first jobs after fashion college was at Perry Ellis, the label that launched the idea of American sportswear as fashion. There, she worked with the then unknown youngster, Marc Jacobs, who taught her about fit and fabrics. She stayed there for three years, during which time Jacobs showed his infamous grunge collection, the kickoff for that 90s trend, after which he was duly fired from the company and then started his own label. He later suggested to Ferlisi that she join him but, she says, looking down a little embarrassed, she declined because "I'm more of a casual clothes kind of person, so that wasn't really me."

She then worked for Tommy Hilfiger - another label whose USP is American style - before hooking up with Jacobs again in 1998 when he invited her to help him launch his hugely successful diffusion line, Marc by Marc Jacobs, which, with its piping trimmed jumpers and funky little jackets, is also definably American in style.

Yet, despite this very American bent to her look, Ferlisi is actually Canadian. But, she says, this is precisely what formed her taste: "Of course I grew up with American culture, in the TV, movies and fashion. But also, coming from the outside, I think I define American culture from a very idealistic viewpoint - that sense of freedom and almost surreal cheerfulness."

Ferlisi herself seems to be a pretty cheerful person - "Definitely a glass half full kinda person," she agrees. Nevertheless, although she "really, really loved" working at Marc by Marc Jacobs, she began to get tired. They were just starting off the line so there was "a lot of travelling", she says, her voice mimicking the weariness she remembers, and she began to miss her family. So she left this plum fashion job in 2000, worked for a few years for the label Theory before Gap rang her up and asked if she fancied being their executive vice-president of design, which is a fancy way of saying in charge of all the clothes.

"My daughters were thrilled when I told them I was going to Gap because before then I had worked at all these obscure places," she laughs. "Now whenever we go in they ask, 'Did you design that? Did you design that?' And I always say yes so they think I design everything."

But although her move pleased her daughters, others might have been a little more puzzled. Even Ferlisi concedes that when she arrived, the brand "needed to be updated and made more relevant". So, she brought to bear on it the lessons she learned from Jacobs, smartening up the fit and improving the fabrics (ie, going beyond khaki and denim to silks and velvets.)

But designers at big conglomerate stores often arrive with good intentions. Putting them into practice and on the shop floor is a different issue, as anyone who has worked for Marks & Spencer could probably tell you. So how did Ferlisi get her ideas past the boardroom? She demurs a little on this point, making the usual noises about "everyone being so supportive" and "new day for the brand", but perhaps Ferlisi was in the lucky position of being the designer for a brand that realised that if it wanted to change the figures on the spreadsheets, it had to change its style.

"And now," she says, all smiley and cheery, "I get to reach out to a lot of people and that is really empowering. But the most empowering thing of all is when someone asks me where I bought something and I say, the Gap, and they say, 'The Gap? Really?' That's the best thing of all."